Crawley Borough Council was awarded £40,000 from central government to look into using low carbon technology to power the town.
The grant from the Department of Energy and Climate Change will be used to investigate the possibility of powering large parts of the town centre with a network of communal energy sources.
Cllr Ken Trussell, cabinet member for Environment, said: “A town centre heat network would be of great benefit to Crawley.
“It potentially means that several local businesses and households could get their heat from a local energy centre, rather than having their own boilers.
“This is a greener type of heat that’s good for the environment because there’s a lot less waste; it’s also a cheaper form of energy so should help Crawley businesses with their energy bills too.”
The study will assess how many buildings and businesses could benefit from the network.
A spokeswoman for the council said the network’s units could be supplied by sustainable materials, such as ethically-sourced wood chips.
The council will also be given commercial and technical help, including assistance in developing business plans, as part of the grant.
The money came from the first round of grants from the Heat Network Delivery Unit; Crawley Borough Council was one of 26 successful councils awarded in the drive to promote the development of heat networks.
Estimates show 14 per cent of UK heat demand could be cost effectively met by heat networks by 2030 and around 43 per cent by 2050.